Executive Summary
Laws and Precedent
A Tampa-based pharmacy, VRA Enterprises, LLC, operating as Precision Rx, has agreed to pay the United States over $17 million to resolve allegations that it defrauded Medicare by submitting false claims for Over-The-Counter (OTC) COVID-19 tests. The Department of Justice announced the $17,069,371 settlement on November 14, 2025, addressing claims that VRA billed Medicare for tests that were never provided to beneficiaries or were shipped months after the claims were submitted.
Allegations of False Claims
According to the settlement, VRA Enterprises allegedly violated the False Claims Act by knowingly submitting or causing the submission of false claims to Medicare. These claims were made in connection with the Centers for Medicare & Medicaid Services (CMS) OTC COVID-19 Test Demonstration Project, which ran from April 2022 to May 2023.
During the Demonstration Project, Medicare Part B beneficiaries could request up to eight OTC COVID-19 tests per month from participating providers like VRA. CMS would then reimburse these providers at a fixed rate of $12 per test. The United States contended that between August 2022 and May 2023, VRA submitted claims for tests it never provided to beneficiaries.
A specific allegation highlighted that in January 2023, VRA submitted approximately 136,491 claims to Medicare for OTC COVID-19 tests that were not shipped to beneficiaries until April 2023, months after billing. The company reportedly received thousands of complaints from beneficiaries regarding missing tests and internally acknowledged billing Medicare for tests it “failed to ship,” suggesting immediate refunds that were not issued.
Official Statements
U.S. Attorney Gregory W. Kehoe emphasized the Department of Justice’s focus on civil fraud cases against providers who exploited federal health programs during the COVID-19 pandemic. “This settlement is an excellent example of our district’s commitment to meeting this important challenge,” Kehoe stated.
Christian J. Schrank, Deputy Inspector General for Investigations of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), underscored the impact of such fraud. “When providers bill for services that were never delivered for matters such as COVID-19, they not only squander taxpayer dollars, but they also drain critical resources in our public health response,” Schrank said. He affirmed HHS-OIG’s dedication to working with law enforcement to combat deceptive schemes that violate the False Claims Act.
Investigation and Resolution
The resolution of this matter was a collaborative effort involving the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, the U.S. Attorney’s Office for the Middle District of Florida, and HHS-OIG. The case was handled by Civil Division Fraud Section Trial Attorney Lindsay DeFrancesco and Assistant U.S. Attorney Carolyn Tapie.
It is important to note that the claims resolved by this settlement are allegations only, and there has been no formal determination of liability.
Commitment to Combating Fraud
This settlement reinforces the Justice Department’s ongoing efforts to prosecute fraud against federal health programs, particularly those that were vulnerable to exploitation during the COVID-19 public health emergency. The coordinated action by federal agencies highlights a continued commitment to safeguarding taxpayer funds and maintaining the integrity of the nation’s healthcare systems.
